Financial discipline. A subject that is both alluring and discouraging at the same time – the very words conjure up images of people counting pennies by candlelight and being overly concerned about the heating bill.
While financial discipline does require a considerable amount of effort, it need not take over your entire life. Not to mention, the rewards of being diligent with your finances can be great – you can work your way out of debt, save for the future, and even turn up the thermostat occasionally because you’ll have the green to pay for the extra heat. Are you ready to take up the challenge?
Of course, being financially disciplined requires work, and there are many different ways to go about being “disciplined,” so take these guidelines as just that – guidelines. If you find other ways to go about controlling your spending and upping your savings – go with it!
- Organization. Go through and organize all of your financial documents – yes, that means that huge stack of paper you’ve been ignoring for years. Some easy divisions to organize your records in could include such exciting titles as “taxes,” “insurance,” “income,” “house/apartment,” “medical,” “vehicle,” and so on. Everybody has different financial needs, so tailor your organization to your own needs!
- After you’ve organized your records, break out the calculator and figure out how much you spend in each category. Notice which expenditures are necessary, like utilities and rent, and how much you spend on extraneous things, like entertainment.
- If you are unable to calculate how much you spend on entertainment, start keeping a personal log – write down every latte you buy, every pair of shoes or new DVD that you can’t pass up. After about three months of this, you’ll get a pretty good idea of how much you spend on non-essential items.
- With this information in hand, start budgeting! How much do you spend on those non-essential things – and how much can you cut without feeling like Scrooge? It also helps if you have financial goals for the future – do you want to buy a car, a house, or go traveling? Figure out how much those things will cost, and then start moving around your finances to make it happen.
Some other aspects of financial discipline can pass over to your every day life. Consider doing simple things, like going to see a movie at matinee rather than at full-price, or making coffee at home as opposed to picking up a cup at a coffee house. You’d be surprised how much this adds up – and even more astonished at how quickly you’ll save money if you try!